A defining year for IoT: What made the headlines in 2016

Internet of Business looks back on the impact of the Internet of Things (IoT) in 2016, including the key partnerships, the headline mergers and acquisitions and the leading case studies. We also look at what could be in store in 2017…

Partnerships are the way forward

The Internet of Things is the bringing together of a collection of devices and systems to achieve a certain goal. In the smart home, that may include your voice-controlled assistant communicating to your thermostat to turn the heating down, or with the connected lighting to adjust the light. In an industrial setting, it’s about cyber-physical systems communicating and collaborating to boost the efficiency of production.

The point here is that it’s an assortment of technologies and systems, and it can’t be done well by just one party. And so it proved that 2016 was the year of IoT partnerships.

It all started back at CES in January, where AT&T announced it was going to team up with Cisco, Deloitte, Ericsson, GE, IBM, Intel and Qualcomm in order to build ‘smart’ connected communities.

Beginning with the Georgia Institute of Technology in Atlanta to improve sustainability, in Chicago to maximize efficiency and in Dallas’ West End Historic District to enhance operations, the frameworks are creating smarter cities, roads, venues and public properties.

Some of these partnerships cropped up per vertical, too, from Apple and Aetna in insurance to HPE and GE in Industrial IoT, as businesses realize and admit that going IoT alone is not wise. Furthermore, partnerships like GE and Bosch prove that even competitors need to collaborate to facilitate industry adoption.

Jobs and courses emerge to plug the skills-gap

As more companies have put greater emphasis on IoT as a future revenue driver, so the subject itself has become more professional – literally. The Massachusetts Institute of Technology (MIT) – one of the most prestigious universities in the world – now offers an online course designed to give professionals a more thorough understanding of the principles behind IoT.

The course is said to involve an introduction to the concepts around the technology as well as a roadmap of developments, and guest lectures from the institute’s professors, including ‘father of the web’, Sir Tim Berners-Lee.

Furthermore, more than a handful of UK and US universities are now actively recruiting for professors specializing in the Internet of Things, perhaps foreseeing both the need for these skills from companies, but also demand for these courses from students.

Given that every technology from connected cars to smart shopping is predicted to take off in 2020, expect to see this degree on a list of highest paying degrees by salary potential sometime in the next four years. After all, companies are already crying out for data scientists, engineers and developers, while there’s supposedly an emerging trend for hiring CIOT officers.

And skills are going to be crucial going forward, as one expert told us last week:

“Next year, as organizations become more aware of the necessity to adapt and implement IoT technologies into their business IT infrastructure, the lack of skills needed to carry out such campaigns will become obvious,” says Dr Joseph Reger, CTO at Fujitsu, EMEA. “No doubt in 2017 there will be a huge industry push to identify, source, secure and retain such talent – whether that be by finding new or re-training and cross-training existing staff.”

Under his leadership, the US Department of Commerce (DoC) announced it wants to be a digital entity with its fingers deep in the Internet of Things pie. This digital lustfulness should come as no surprise if we look at the DoC’s guiding tenets and mission. The self-stated raison d’être of the department is: to promote job creation and improved living standards for all Americans by creating an infrastructure that promotes economic growth, technological competitiveness, and sustainable development.

The US DoC’s National Telecommunications and Information Administration (NTIA) has therefore been tasked with conducting an analysis to assess what role – if any – the government should play in the IoT’s development. And that’s a crucial question every forward-thinking country is asking themselves right now, especially on areas like information security, regulation and helping local start-ups to establish themselves.

The first big tech buyout

Across the pond, it was the private sector leading the way for IoT. Midway through the year the Japanese technology firm, Softbank, acquired UK chip maker, ARM Holdings, in a £24bn ($30bn) deal which left many UK tech experts lamenting the loss of the last potential British unicorn.

ARM’s products are used in roughly 16 billion smartphones, but it wasn’t this area where Softbank saw growth. That is to be found with the burgeoning world of the Internet of Things. Its expertise in chip manufacture makes ARM Holdings a key strategic buy for an organization with an eye on the IoT, and gives Japanese telecoms giant Softbank a strong foothold in a technology area that is set to take off in a big way.

Of course, this was by no means the only IoT-related acquisition of the year, and we expect more market consolidation next year. Here’s a breakdown of the top ten acquisitions in the IoT market in 2016.

What do we want? Standards! When do we want it? Now!

Yet, while there’s been a lot to feel positive about for IoT going into the festive period, there remain some crucial problems, and none more so than the growing issue of standards.

Don’t get us wrong, there have been some fantastic achievements this year. Vodafone and Huawei completed the first over-the-air connection on a live network using standardized Narrow-Band IoT (NB-IoT). Similarly, Ireland, Scotland and London announced major plans to invest in LPWA networks to support the low-cost, low-power IoT applications and devices that will be the most prominent in the coming years.

But that’s part of the problem. To use a hypothetical example, how can the Port of Cork in Ireland scale its solutions if other ports don’t use the same technology? Yes, IoT might be aiding supply chain complexity by allowing port operators to better track their fleets, but how do we extend that to ports globally so that a ship is able transmit and share data wherever it is in the world?

So, whether it’s Sigfox, LoRa, NB-IoT, Bluetooth or Wi-Fi, there’s a standards problem in IoT (over 400 of them, actually), but here’s at least one suggestion for how to solve it.

Attack of the…IoT kitchen appliances?

OK, so we weren’t actually attacked by fridges and kettles – and for anyone thinking about connecting a kettle…don’t – but we did witness some major cyber-attacks using IoT devices this year.

Back in October, the personal website of the cyber-security journalist, Brian Krebs, was taken down by devices infected with a Mirai botnet, a new malware that enables distributed denial of service (DDoS) attacks.

The code was then made public and unsurprisingly the attack was followed up later that month by a DDoS attack by as many as 100,000 endpoints on the Dyn domain name server (security researcher Ken Munro later told us that this was more likely in the ball-park of 20,000 devices – Ed). It left many people unable to access websites like Netflix, Twitter and Spotify, but more worryingly – thanks to IoT devices – these DDoS attacks are now reaching huge sizes of 600 Gbps and beyond.

These kinds of attacks potentially put critical infrastructure at risk, and it was this Mirai attack which led Brian Honan, CEO of BH Consulting, to suggest “we may have reached a tipping point where Governments must now look at regulating minimum cyber-security and data protection standards that all devices must adhere.”

Privacy concerns show no sign of disappearing

So, we’ve got standards problems, security problems…what next? To paraphrase Bill Clinton, it’s privacy, stupid. The IoT generates huge quantities of data, and enables businesses to better track their assets or know more about their products or consumers. However, there is a clear need to protect this data, especially if it contains Personal identifiable information (PII).

The US director of national intelligence, James Clapper, admitted earlier this year that IoT could be used for government spying and for surveillance programmes of the future. It’s hard to say how people will react to this (most citizens weren’t too bothered by Edward Snowden’s revelations – Ed). Though it is bound to make some anxious.

Compound this with the news that a major national newspaper in the UK decided to use M2M technology to track when its own staff were at their desks for what it claims was a program to improve energy efficiency in its building. The company in question faced a strong backlash and quickly reneged on the decision, but the point stands: people aren’t that keen on the idea of becoming the next connected ‘thing’.

What does this mean going forward? Given the rise of IoT and also new European privacy regulations (GDPR), companies adopting IoT will have to get smarter about what data they collect and when, and what data can be anonymized.

An eye to the future

For a complete summary of all of the many predictions for IoT in 2017 to date, why not check out our video of the top seven predictions for IoT in 2017 from those in the know – Hive’s CTO and IBM’s cognitive and analytics leader in Europe to name a few.